From The Toledo Blade
Ohio county officials generally like Gov. John Kasich’s plan to expand the sales-tax base to a long list of services, but they’re raising the alarm over the idea the state thinks it can then cut their locally approved “piggyback” sales tax rates.
“We believe that this violates the principle of local control and sets a dangerous precedent that could open the door to the reduction of other locally enacted taxes in the future,” Larry Long, executive director of the County Commissioners Association of Ohio, told a House subcommittee this week.
Counties are authorized to enact a local sales tax rate of up to 1.5 cents on the dollar to “piggyback” on top of the statewide rate of 5.5 cents. Forty-eight counties have enacted the maximum rate. Lucas County is at 1.25 cents on the dollar.
Mr. Kasich has proposed expanding the state’s sales tax base to a litany of currently untaxed services — cable TV, legal services, coin-operated laundries, haircuts, pet grooming, travel agents, advertising, and magazine subscriptions among them.
That alone is expected to generate more than $3 billion in additional sales tax revenue over the next two years.
The expansion, however, is part of a broader tax package that also calls for a half-penny reduction in the current sales tax rate to 5 percent, a hike in severance taxes paid by shale oil and natural gas drillers, and a net $1.4 billion income tax cut for individuals and small businesses.